ELLEN SEGAL HUVELLE, District Judge.
Following a remand from the Court of Appeals, see Reckitt Benckiser, Inc. v. EPA, 613 F.3d 1131, 1133 (D.C.Cir.2010), the parties have filed cross-motions for summary judgment on the following issue of statutory interpretation: whether the United States Environmental Protection Agency ("EPA") has authority under the Federal Insecticide, Fungicide and Rodenticide Act ("FIFRA"), 7 U.S.C. §§ 136-136y, to bring a misbranding action in lieu of a cancellation proceeding against plaintiff Reckitt Benckiser's registered rodenticide products based solely on those products' non-compliance with the EPA's May 28, 2008 "Risk Mitigation Decision for Ten Rodenticide Products" ("RMD"). For the reasons stated herein, the Court will grant plaintiff's motion, deny defendant's motion, and enjoin EPA from bringing an enforcement action against plaintiff or any of its products based upon a failure to satisfy the requirements of the RMD until defendants have completed the administrative cancellation procedures required by FIFRA Section 6, 7 U.S.C. § 136d.
The following sections of FIFRA, 7 U.S.C. §§ 136-136y, are relevant to the question of statutory interpretation that is before the Court: § 136 (Definitions) (FIFRA § 2); § 136a (Registration of Pesticides) (FIFRA § 3); § 136a-1 (Reregistration of registered pesticides) (FIFRA § 4); § 136d (Administrative review; suspension) (FIFRA § 6); § 136j (Unlawful acts) (FIFRA § 12); 7 U.S.C. § 136k (Stop sale, use, removal, and seizure) (FIFRA
FIFRA requires that all pesticide products sold or distributed in the United States be registered with EPA. 7 U.S.C. § 136a(a). EPA is directed to approve the registration of a pesticide if "(A) its composition is such as to warrant the proposed claims for it; (B) its labeling and other material required to be submitted comply with the requirements of this subchapter; (C) it will perform its intended function without unreasonable adverse effects on the environment; and (D) when used in accordance with widespread and commonly recognized practice it will not generally cause unreasonable adverse effects on the environment."
"A pesticide product remains registered until EPA or the registrant cancels it pursuant to FIFRA Section 6, 7 U.S.C. § 136d."
Under FIFRA, EPA has the authority to bring enforcement actions for "unlawful acts," one of which is distributing or selling a pesticide which is "misbranded." 7 U.S.C. § 136j, 136k, 136l.
7 U.S.C. § 136(q)(1) (emphasis added). The terms "protect health and the environment" and "protection of health and the environment" are further defined in section 136(x) to mean "protection against any unreasonable adverse effects on the environment," 7 U.S.C. § 136(x), the same language used in the Registration and Cancellation Standards. 7 U.S.C. §§ 136a, 136d.
When EPA concludes that a pesticide is "misbranded" in violation of FIFRA, it "may issue a written or printed `stop sale, use, or removal' order to any person who owns, controls, or has custody of such pesticide," 7 U.S.C. § 136k(a)
In 1988, Congress enacted FIFRA Section 4, which established procedures for the reregistration of pesticides whose active ingredients were first registered in a pesticide before November 1, 1984. See 7 U.S.C. § 136a-1(a). The process involved five phases, 7 U.S.C. § 136a-1(b),
Plaintiff manufactures pesticides that are subject to regulation under FIFRA. On May 28, 2008, as part of FIFRA Section 4's "reregistration" process, 7 U.S.C. § 136a-1, EPA issued a "Risk Mitigation Decision for Ten Rodenticides" ("RMD"). (Pl.'s Mem. in Support of Mot. for Summ. J. ["Pl.'s Mem."], Ex. 1, Sept. 24, 2010; Pl's Statement of Material Facts ["Pl.'s SOMF"] ¶ 1.)
The RMD directed "[p]ersons [including plaintiff] holding a manufacturing-use or end-use registration for a rodenticide product containing one of the active ingredients covered by this risk mitigation decision" to "provide a letter to the Agency on or before September 2, 2008, declaring an intent to comply or not comply with the risk mitigation measures described in this document." (Id.) Specifically, registrants were directed that "this 90-day response letter must indicate, for each of the registrants' registered rodenticide products, whether the registrant intends to amend the registration to conform to the risk mitigation decision." (Id.) The RMD further provided that "[f]or each registered product for which a registrant declares its intent not to comply (i.e., not to amend labeling and/or packaging and not to develop a replacement bait station product), the
The RMD stated that "should a registrant fail to implement any of the risk mitigation measures identified in this document, the Agency may take regulatory action to address the risk concerns from the use of the affected products." (Id.) It also provided that "June 4, 2011 would be the last day for registrants to `release for shipment' (sell or distribute) rodenticide products not complying with the Risk Mitigation Decision" and that "[r]odenticide products that do not comply with this Risk Mitigation Decision that a registrant releases for shipment after June 4, 2011, would be considered misbranded." (Id. at 26.) However, according to the EPA, the RMD "does not represent individual product reregistration decisions under FIFRA Section 4(g)(2)(C) or (D)" and that it "imposes no legally binding requirements on any regulatee, either upon issuance of the RMD or as of June 4, 2011." (Defs.' SOMF ¶¶ 2, 21.)
On June 18, 2008, EPA sent letters directly to registrants, advising them of the RMD's conclusions and implementation timetable. (Pl.'s Mem., Ex. 2, at 1.) Registrants were advised that to comply with the RMD, "[s]ome currently registered rodenticide products may be brought into compliance with the risk mitigation decision through amendment," but others "will require cancellation." (Id. at 3.) Thus, registrants were told, "[f]or each registered product that is covered by the risk mitigation decision and which will not be amended to comply, registrants must submit a request to voluntarily cancel that product under FIFRA § 6(f)(1) [7 U.S.C. § 136d]." (Id. at 4.) The 90-day response form that EPA sent out with the June 18, 2008 letter, gave registrants the option of either (1) selecting an the "intended method for complying," one of which was voluntary cancellation; or (2) selecting the option "I do not intend to voluntarily bring this product into compliance with the requirements of the May 2008 risk mitigation decision. I understand that EPA may pursue additional regulatory action, including cancellation." (Id. at 6.)
Plaintiff timely filed its 90-day response for its thirteen affected products,
On March 5, 2009, plaintiff filed its Verified Complaint in this matter, seeking declaratory and injunctive relief preventing EPA from initiating misbranding or other enforcement actions against plaintiff's affected products until the procedures of
Plaintiff appealed this Court's decision and also filed a direct petition for review in the Court of Appeals. The Court of Appeals held that the first question that had to be addressed was "EPA's interpretation of its misbranding authority under FIFRA"—that is, whether EPA had authority under FIFRA to bring a misbranding action based on noncompliance with the RMD rather than commencing cancellation proceedings. See Reckitt, 613 F.3d at 1141 ("evaluating EPA's interpretation of its authority under FIFRA to implement the RMD through enforcement proceedings for misbranding is a prerequisite to evaluating [plaintiff's] contentions that EPA improperly delayed or refused to initiate Section 6 cancellation proceedings"). The Court of Appeals concluded that EPA's assertion of that authority in the RMD was a "binding procedural determination" that constituted "`final agency action' under the APA [Administrative Procedure Act], 5 U.S.C. § 704"; the issue was "ripe for review"; and the district court had jurisdiction because EPA's legal interpretation of its authority was "other final action of the Administrator" under FIFRA Section 16(a), 7 U.S.C. § 136n. Reckitt, 613 F.3d at 1141.
Plaintiff argues that EPA's legal interpretation of its authority is arbitrary, capricious, an abuse of discretion and not in accordance with law because it "would utterly defeat Congress' intent in enacting the registration and cancellation process." (Pl.'s Mem. in Support of Mot. for Summ. J. at 10, Sept. 24, 2010 ["Pl's Mem."].) Plaintiff's view is that "EPA may not bring an enforcement action against [plaintiff's] properly registered products for allegedly failing to conform to the [Registration Standard]," but rather "must actually comply with the Act's provisions for cancelling a registration." (Id. at 10.) EPA argues that its interpretation is entitled to deference under Chevron and, therefore, must be accepted because it is "reasonable." (Defs.' Mem. in Support of Defs.' Cross-Mot. for Summ. J. at 13, Oct. 12, 2010 ["Defs.' Mem."].) Even if no deference is due, EPA argues that its interpretation is "compelled" by the "plain language of FIFRA and its history." (Id.)
The scope of review of a challenge to the EPA's actions under FIFRA is governed by the Administrative Procedure Act ("APA"). See Defenders of Wildlife v. E.P.A., 882 F.2d 1294, 1303 (8th Cir.1989). Agency action reviewed under the APA may not be overturned unless it is "arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law." 5 U.S.C. § 706(2)(A). As the Court is reviewing an agency's interpretation of a law it administers, it must apply the principles of Chevron U.S.A. Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837, 104 S.Ct. 2778, 81 L.Ed.2d 694 (1984). Se. Ala. Med. Ctr. v. Sebelius, 572 F.3d 912, 916 (D.C.Cir.2009); National Ass'n of Clean Air Agencies v. E.P.A., 489 F.3d 1221, 1228 (D.C.Cir.2007).
Under Chevron, the first step is "examine the statute de novo, employing `traditional tools of statutory construction.'" Nat'l Ass'n of Clean Air Agencies, 489 F.3d at 1228 (quoting Chevron, 467 U.S. at 843, 104 S.Ct. 2778); see Mount Royal Joint Venture v. Kempthorne, 477 F.3d 745, 754 (D.C.Cir.2007) (court begins by "applying customary rules of statutory interpretation"). "Because the judiciary functions as the final authority on issues of statutory construction, `[a]n agency is given no deference at all on the question whether a statute is ambiguous.'" Wells Fargo Bank N.A. v. FDIC, 310 F.3d 202, 206 (D.C.Cir.2002) (quoting Cajun Elec. Power Coop., Inc. v. FERC, 924 F.2d 1132, 1136 (D.C.Cir.1991)). "If the intent of Congress is clear, that is the end of the matter; for the court, as well as the agency, must give effect to the unambiguously expressed intent of Congress." Chevron, 467 U.S. at 842-4, 104 S.Ct. 2778; see Eagle Broadcasting Group, Ltd. v. FCC, 563 F.3d 543, 552 (D.C.Cir.2009) (if the "search for the plain meaning of the statute. . . yields a clear result, then Congress has expressed its intention as to the question, and deference is not appropriate." (internal quotations omitted)); Arkansas Dairy Co-op Ass'n, Inc. v. U.S. Dept. of Agr., 573 F.3d 815, 829 (D.C.Cir. 2009) (no deference due where agency's construction is "contrary to clear congressional intent"). Only if "the statute is silent or ambiguous with respect to the
Under the first step of Chevron, the Court must use the "customary statutory interpretation tools of `text, structure, purpose, and legislative history'" to determine whether Congress's intent as to the precise question at issue is clear. California Metro Mobile Communications, Inc. v. FCC, 365 F.3d 38, 44-45 (D.C.Cir.2004) (quoting Consumer Electronics Ass'n v. FCC, 347 F.3d 291, 297 (D.C.Cir.2003)). Even if there are "textual ambiguities," "a statute may foreclose an agency's preferred interpretation . . . if its structure, legislative history, or purpose makes clear what its text leaves opaque." Catawba Cty. v. EPA, 571 F.3d 20, 36 (D.C.Cir. 2009); see also Ass'n of Civilian Technicians, Inc. v. U.S., 603 F.3d 989, 992 (D.C.Cir.2010) (in looking at the text of a statute, "words are to be read in the context in which they are used and in the broader context of the statutory scheme" (internal quotations omitted)). Using these tools, the Court concludes that FIFRA does not give EPA the authority to pursue a misbranding enforcement action in lieu of a cancellation proceeding based on a registrant's failure to comply with the RMD.
Plaintiff argues that EPA's interpretation of FIFRA renders the Section 6 cancellation procedures meaningless, in violation of the "cardinal principle of statutory construction that a statute ought, upon the whole, to be so construed that, if it can be prevented, no clause, sentence, or word shall be superfluous, void, or insignificant." TRW Inc. v. Andrews, 534 U.S. 19, 31, 122 S.Ct. 441, 151 L.Ed.2d 339 (2001). EPA counters that plaintiff's interpretation of FIFRA suffers from similar infirmities.
Plaintiff argues that only its interpretation is consistent with the existence and content of Section 6, 7 U.S.C. § 136d. The Court agrees. Section 6 is the "cancellation" section within FIFRA. It establishes a detailed, multi-step process that EPA must follow when it wants to cancel or suspend a registration. Reckitt, 613 F.3d at 1134 ("A pesticide product remains registered until EPA or the registrant cancels
It is undisputed that plaintiff holds valid registrations for products that EPA believes must be cancelled because they do not comply with the RMD. Yet, if EPA also has the authority to bring misbranding enforcement actions after June 4, 2011, against these registered products based on non-compliance with the RMD, it will be able to "bypass[] cancellation proceedings" and "effect[ively] cancel[] the registrations without following the regulatory procedures provided in Section 6." See Reckitt, 613 F.3d at 1136. To interpret FIFRA to give EPA that authority not only renders Section 6 superfluous; it also allows EPA to avoid the rigorous cancellation process Congress provided for in the statute. In addition, as plaintiff points out, under EPA's interpretation applicants whose registrations are denied are guaranteed access to the procedural protections of Section 6, see 7 U.S.C. § 136a(c)(6),
EPA's only response to plaintiff's Section 6 argument is that because there is no "express provision" in FIFRA linking EPA's authority to pursue misbranding action under FIFRA Sections 12, 13, and 14 to its cancellation authority in FIFRA Section 6, it follows that "it may bring a misbranding action under FIFRA Sections 12, 13, and 14, at the end of the reregistration process or at any other time, when it believes a product is misbranded, without first cancelling that product's registration under FIFRA Section 6." (Defs.' Mem. at 22) In EPA's view "[i]f Congress had intended to require EPA to cancel a registered pesticide before pursuing misbranding action, it could easily have put language to that effect into FIFRA." (Id.) However, given Congress's establishment of a detailed process for cancellation (or suspension in the event of an "imminent hazard"), it is reasonable (and more likely) that Congress did not expressly prohibit EPA from proceeding with a misbranding action, instead of a cancellation proceeding, because it never contemplated that EPA would try to use such an enforcement action (or threat of such an action) as a substitute for a cancellation proceeding once it had concluded that a product's registration should be cancelled.
Accordingly, the Court concludes that the existence and content of Section 6 is strong evidence that Congress intended
EPA argues that only its interpretation gives effect to FIFRA Section 4(g)(2)(D), the provision which directs EPA to take "appropriate regulatory action" once it determines that a pesticide is not eligible for reregistration. Id. § 136a-l(g)(2)(D). However, this argument is not persuasive. The only issue in the present case is whether EPA has the option of pursuing a misbranding enforcement action rather than a cancellation proceeding once it has determined as part of a reregistration eligibility decision that a product is "not eligible for reregistration," and, therefore, it must be cancelled. To adopt plaintiff's view would not read Section 4(g) out of the statute, but would simply reject EPA's contention that "appropriate regulatory action" under the specific factual circumstances presented here includes a misbranding enforcement action in favor of plaintiff's position that the "appropriate regulatory action" is limited to a cancellation proceeding.
EPA also argues that because it is possible that misbranding might be "discovered" during the reregistration review process, "appropriate regulatory action" must include the power to bring a misbranding action. EPA's argument is circular: if a "misbranding" enforcement action is authorized by the statute, EPA may bring it, irrespective of Section 4(g) or when and how it determined that a registered product is misbranded. But if a misbranding enforcement action is not authorized under certain circumstances—the issue before the Court—then it is not "appropriate" action.
Finally, EPA argues that because FIFRA does not expressly define what constitutes "regulatory action," nor does it specify any limits on what regulatory actions are appropriate in the context of Section 4(g)(2)(D), its interpretation must be correct. In making this argument, however, EPA completely ignores that the legislative history posits that "appropriate regulatory action" following a reregistration eligibility decision would include actions "such as canceling, suspending, or restricting the pesticide, or imposing label changes . . .," H.R. Rep. No. 100-939, at 30 (1988), reprinted in 1988 U.S.C.C.A.N. 3474, 3479 (1988) (emphases added), but makes no mention of a misbranding enforcement action as an option.
EPA next text-based argument is that only its interpretation gives effect to 7 U.S.C. § 136(q)(1)(F) and (G). Subsection (F) provides that a pesticide is misbranded if "the label accompanying it does not contain directions for use which . . . are adequate
EPA's final textual argument is based on FIFRA's provision that "[i]n no event shall registration of an article be construed as a defense for the commission of any offense under this subchapter." 7 U.S.C. § 136a(f)(2) (emphasis added). Rather, "[a]s long as no cancellation proceedings are in effect registration of a pesticide shall be prima facie evidence that the pesticide, its labeling and packaging comply with the registration provisions of the subchapter." 7 US.C. § 136a(f)(2). Based on this language, EPA argues that
(Defs.' Mem. at 20.) EPA's conclusion goes far beyond what the text requires. A FIFRA registration is essentially a license to sell and distribute pesticide products in accordance with the terms of the registration and the statute. Thus, the Court agrees with plaintiff that "Section 3(f)(2) stands for the unremarkable proposition that a registration is not a defense against an allegation that a product violates the terms of that registration, just as a valid driver's license is not a defense against a speeding ticket." (Pl.'s Mem. at 17.)
Both plaintiff and defendant claim that the FIFRA's legislative history supports their interpretation. When FIFRA was first enacted in 1947,
In 1964, Congress amended FIFRA to "eliminate registration under protest." Pub.L. 88-305, 78 Stat. 190, and replace it with "various appeal procedures where registration is refused or canceled." S. Rep. 88-573, at 1 (1963) (Br. of Amicus Curiae, Attachment 2, Sept. 30, 2010) ("purpose" of the amendments was both "to end the practice of protest registration whereby the manufacturer of a pesticide can market a product despite Department of Agriculture doubts as to its effectiveness or safety," and replace it with "a complete appeal system whereby the applicant for registration can appeal the decision" to refuse or cancel a registration); H.R.Rep. No. 88-1125, at 1 (1964), reprinted in 1964 U.S.C.C.A.N. 2166 (same).
The legislative history establishes that the amendments were aimed at several distinct problems caused by the existing system. First, Congress believed there was a "need for the legislation" because:
Id. at 2, reprinted in 1964 U.S.C.C.A.N. at 2167. A second "need for the legislation" existed because under the protest registration system, if a product had been registered under protest, the registrant was "protected from the effects of failure to register, but not from penalties and seizure if the product is actually misbranded or otherwise out of compliance with the act." Id. As explained by Senator Ellender:
109 Cong. Rec. 20,079 (Oct. 22, 1963) (statement of Sen. Ellender) (prior to 1964, ("if a registrant disagreed with the Agency's determination as to the safety of its product, its only recourse was to market the product and face the risk of a prosecution and penalties in an enforcement action"). By providing that "applicants dissatisfied with the Secretary's action in refusing or canceling registration may have recourse to advisory committee
The only plausible reading of the legislative history relating to the 1964 amendments is that Congress intended to eliminate the system of protest registration and to create an administrative cancellation process to take its place, see Environmental Defense Fund v. Ruckelshaus, 439 F.2d 584, 593 (D.C.Cir.1971) (1964 amendments "eliminate[d] the system of protest registration and substitute[d] the present administrative mechanism for cancelling registrations"), because it was concerned both with the risks of having unsafe products on the market and it wanted to eliminate the system whereby registrants had to risk prosecution if they disagreed with the agency's determination as to registration eligibility. To accept EPA's interpretation in the present case would recreate precisely the same problem Congress intended to eliminate in 1964: forcing plaintiff to accede to EPA's demand that it change its products to conform to reregistration standards of the RMD or face the severe sanctions of enforcement proceedings. The Court agrees with plaintiff that "If . . . Congress meant to allow EPA to continue to use its enforcement authority to remove already registered products from the market, there was little point to creating the registration and cancellation provisions at all." (Pl.'s Opp'n to Defs.' Mot. for Summ. J. & Reply in Support of Pl's Mot. for Summ. J. at 20, Oct. 29, 2010 ["Pl's Opp'n & Reply"].) Indeed, as plaintiff points out, "under EPA's view of its misbranding authority, an applicant is entitled to a Section 6 hearing if it is denied an initial registration under Section 3, but EPA is free to bypass Section 6 and proceed directly to enforcement if the Agency changes its mind about a registered product and concludes that it no longer meets FIFRA's registration criteria." (Pl.'s Opp'n & Reply at 20.) To afford greater procedural protections to an applicant whose registration is denied than to a registrant selling a registered product in compliance with the terms of its registration is both illogical, see supra p. 13, and in direct conflict with Congress's clear goal of eliminating the system of protest registration and replacing it with a process for cancellation.
In 1972, the Federal Environmental Pesticide Control Act of 1972 rewrote FIFRA, both to amend it and to reflect the transfer of implementation authority from the Department of Agriculture to EPA. Pub.L. 92-516, 86 Stat. 973.
EPA argues that these changes show that Congress intended to "significantly expand[] the definition of misbranding" and make "misbranding and cancellation. . . parallel, albeit independent, regulatory tools." (Defs.' Mem. at 24-25.) Thus, EPA argues, "Congress provided EPA parallel misbranding regulatory authority to ensure that EPA would apply the same standard whether it chose to proceed through misbranding action or cancellation—that pesticide products do not present unreasonable adverse effects." (Id. at 25.) But EPA's interpretation ignores the fact that even though the "unreasonable adverse effects on the environment" standard is now part of the definition of misbranding under subsections (F) and (G), both those subsections are concerned only with a product's "label." In contrast, in both the registration and cancellation context, the standard is used more broadly to address the use of the product, not merely its label. See 7 U.S.C. § 136a(c)(5) (product is eligible for registration if "it will perform its intended function without unreasonable adverse effects on the environment" and "when used in accordance with widespread and commonly recognized practice it will not generally cause unreasonable adverse effects on the environment"); 7 U.S.C. § 136d(b) (product is subject to cancellation if "when used in accordance with widespread and commonly recognized practice, [it] generally causes unreasonable adverse effects on the environment"). Thus, the Court does not agree with EPA that the textual changes to §§ 136(q)(1)(F) and (G) compel the conclusion that misbranding and cancellation are "parallel, albeit independent, regulatory tools." (Defs.' Mem. at 25).
There is nothing else in the legislative history of the 1972 amendments to support EPA's interpretation. Indeed, an earlier version of the bill included a provision that a pesticide would be misbranded if "when used in accordance with the requirements of the Act or commonly recognized practice it causes unreasonable adverse effects on the environment," language almost identical to the standard for cancellation, but that language was eliminated in conference because
H.R. Conf. Rep. 92-1540, at 2, reprinted in 1972 U.S.C.C.A.N. 4130, 4131.
The 1988 amendments created the reregistration process that ultimately led to the RMD. In terms of their relevance to the issue of statutory interpretation before the Court, EPA makes three points. First, EPA argues that it is significant that the 1988 amendments did not take away any preexisting enforcement power because
(Defs.' Mem. at 25.) This argument is problematic, however, because Ciba-Geigy was the first time (and only time prior to the pending matter) EPA had ever asserted that it had the authority to effectively cancel a registration through use of a misbranding action, and, significantly, the case settled prior to any decision on the merits of EPA's position. Nor is there any indication in the legislative history that Congress was even aware of Ciba-Geigy, much less that it was approving EPA's novel position in that litigation.
More generally, EPA argues that the 1988 amendments, along with the 1964 and 1972 amendments, "establish that Congress steadily expanded EPA's regulatory authority." (Defs.' Mem. at 24.) Even if that is true, that general proposition does not suffice to answer a specific question of statutory construction, especially where, as here, the text, structure, purpose and legislative history point to a different conclusion.
Having considered the text, structure, purpose and legislative history of FIFRA, the Court concludes that Congress clearly did not intend to give EPA the authority it asserted in the RMD to bring a misbranding action in lieu of a cancellation proceeding against a product that failed to comply with the RMD and, therefore, in EPA's view, no longer meets the Section 3(c)(5) criteria—the standard for registration, reregistration and cancellation. As the statute is not ambiguous, it is unnecessary to decide what level of deference EPA's interpretation would be entitled to under the second step of Chevron. See, e.g., Martini v. Federal Nat. Mortg. Ass'n, 178 F.3d 1336 (D.C.Cir.1999). Accordingly, the Court grants plaintiff's motion for summary judgment and denies defendants' cross-motion. A separate Order accompanies this Memorandum Opinion.
7 U.S.C. § 136k(a).
7 U.S.C. § 136a-1(b).
Reckitt, 613 F.3d at 1141.
7 U.S.C. § 136a(c)(6) (emphasis added).
